Brazilian mining company Vale has placed a US$1.6 billion order for 12 huge iron ore carriers from China's Rongsheng shipbuilder, and the vessels will be the biggest of their kind in the world, Vale said Sunday.
Companhia Vale do Rio Doce SA said in a statement that the ships will be used to create a "dedicated route'' to ship the company's iron ore from Brazil to Asia, a key market where iron ore is used as the main raw ingredient for steel production.
The ships, which Rongsheng Shipbuilding and Heavy Industries will build for Vale _ the world's largest iron ore producer _ will have a capacity of 400,000 deadweight tons each. The ship deal comes on top of a US$59 billion investment program through 2013 already promised by Vale.
The first of the ships will be delivered in 2011, and the order should be completed by 2012, allowing Vale "to reduce the cost of long-haul maritime transportation of iron ore to steel makers,'' Vale said in its statement.
When combined with other ships already used by Vale and additional ships on order, Vale's fleet will have the capacity of carrying 30.2 million metric tons of iron ore per year from Brazil to Asia. Most of Vale's Asian exports go to China.
Vale last month raised US$11.5 billion to fund operations and possible expansion by selling new stock in New York, Paris and Sao Paulo.
The company said at the time that the money could be used to finance it's US$59 billion investment plan, and would be dedicated to "general corporate purposes'' _ which could include "strategic acquisitions and increased financial flexibility.''
Vale is the second-largest mining company after Anglo-Australian BHP Billiton Ltd. The company's American depository shares closed down 5.8 percent Friday in New York, or US$1.75, to US$28.28.
Companhia Vale do Rio Doce SA said in a statement that the ships will be used to create a "dedicated route'' to ship the company's iron ore from Brazil to Asia, a key market where iron ore is used as the main raw ingredient for steel production.
The ships, which Rongsheng Shipbuilding and Heavy Industries will build for Vale _ the world's largest iron ore producer _ will have a capacity of 400,000 deadweight tons each. The ship deal comes on top of a US$59 billion investment program through 2013 already promised by Vale.
The first of the ships will be delivered in 2011, and the order should be completed by 2012, allowing Vale "to reduce the cost of long-haul maritime transportation of iron ore to steel makers,'' Vale said in its statement.
When combined with other ships already used by Vale and additional ships on order, Vale's fleet will have the capacity of carrying 30.2 million metric tons of iron ore per year from Brazil to Asia. Most of Vale's Asian exports go to China.
Vale last month raised US$11.5 billion to fund operations and possible expansion by selling new stock in New York, Paris and Sao Paulo.
The company said at the time that the money could be used to finance it's US$59 billion investment plan, and would be dedicated to "general corporate purposes'' _ which could include "strategic acquisitions and increased financial flexibility.''
Vale is the second-largest mining company after Anglo-Australian BHP Billiton Ltd. The company's American depository shares closed down 5.8 percent Friday in New York, or US$1.75, to US$28.28.